Global giants Uniqlo, H&M and online onslaught kills Roger David

Global giants Uniqlo, H&M and online onslaught kills Roger David
Simon Evans
Oct 18 2018
AFR
The onslaught of international fast fashion retailers H&M and Uniqlo, fierce competition from online retailers and high rental costs for bricks and mortar outlets have forced budget menswear chain Roger David into administration after its owners were unable to find a last-ditch buyer.
KordaMentha has been appointed as administrators to the chain, which has a history stretching back to 1942. It runs 57 stores and employs 300 staff.
KordaMentha administrator Craig Shepard said there would be a national closing down sale to try and raise as much money as possible for staff and other creditors. The Roger David online site had a “50 per cent off everything” sale running on Thursday.
“Roger David, like many other fashion retailers, has been buffeted by global competition, stagnant sales and rising fixed costs,” Mr Shepard said.
“The company has been exploring all options, including a sale of the business, but has been unable to find an alternative to administration.”
The company has been gradually reducing its store footprint. It had 100 stores around Australia at one point, selling suits, shirts, shoes, tracksuit pants and accessories. The shutdown of Roger David comes amid heartburn across the industry as landlords generally refuse to cut rents even as online sales accelerate.
It operated under the Roger David and RDX brands. The first meeting of creditors will be held on 30 October.
A statement from the directors of Roger David said they were “heartbroken” at having to take this step after such a long history.
“Despite the directors’ best efforts with the business, it simply could not compete with the influx of multinational retailers and the rapid, global evolution of online shopping,” the directors said.
Leading retailers like Premier Investments are threatening an avalanche of store closures unless landlords reduce rents as $2 billion a year in sales – equivalent to the annual turnover at Chadstone, Australia’s largest shopping mall – shift from bricks and mortar to online.
Rents for specialty retailers are still rising an average 4 per cent a year, according to figures from listed retail investment trusts, while same-store sales are growing by less than 2 per cent, increasing margin pressure on retailers grappling with higher labour and energy costs and weaker prices.
Major retailers including Solomon Lew’s Premier Investments, Myer, Wesfarmers’ Target, Lorna Jane, David Jones and the Country Road Group are reviewing store networks, closing underperforming stores if landlords refuse to renegotiate and stepping up investment in e-commerce, which is growing 10 times faster than bricks and mortar retailing.